(Adds details, comments from Possebon, paragraphs 3-11)
By Roberto Samora
SORRISO, Brazil, May 20 (Reuters) - High corn prices in Brazil should prompt producers in the main grain state of Mato Grosso to expand planting of the grain for the 2016/2017 season that starts in September, the state’s deputy agriculture secretary Alexandre Possebon told Reuters.
Improved transport options via new roads and ports to the north of the state will also fuel expansion of soybean planting as the region gains quicker, cheaper access to export markets, he added.
“It’s possible that the coming planting of winter corn will increase a lot as farmers will be enthused by these prices,” Possebon told Reuters, during the Rally da Safra crop tour.
The increase in output of grains should solidify the state’s importance in the production of poultry and pork in the near future for producers such as BRF SA, the world’s largest exporter of poultry, Possebon said.
Brazil exported a record amount of corn from July through March when the sharp depreciation of the real against the dollar propelled sales abroad. This created a shortfall in supplies for the domestic livestock industry, which had to turn to importing the grain from Argentina and the region.
Prices of corn in Mato Grosso are quoted around 40 reais ($11.40) per 60-kg bag, nearly three times the price a year ago. Harvesting of the winter crop in the coming weeks is expected to ease prices off of near record highs.
But grain experts from analysts Agroconsult, which is hosting the crop tour, said the supply shortage would not be fully resolved until 2017, given strong demand.
“There will be corn planted on land in the city limits (next crop),” Agroconsult analyst Marcos Rubin said about the attractive price for the grain in producers’ eyes.
Possebon said the state could easily expand its corn area from the current 4 million hectares to 5 million hectares in the short term.
Corn is typically planted as a second crop after soybeans are harvested during the summer months in the Southern Hemisphere. The winter corn crop has grown quickly in recent years to surpass the size of the previously bigger summer crop.
Possebon said the expansion of soybean area in the summer crop was being driven by the improved access to the export markets through new roads and nearby terminals in the north of Brazil, reducing the state’s need to ship grains 1,500 miles through the congested southern ports of Santos and Paranagua.
$1 = 3.5 reais Writing by Reese Ewing; Editing by Chizu Nomiyama